GBPUSD Movement
For the 24 hours to 23:00 GMT, GBP ended flat against the USD and closed at 1.5875. Earlier the Pound rose as prospects of the Bank of England (BoE) embracing further stimulus measures diminished after economic data released yesterday indicated that inflationary pressures in the UK had resurfaced.
In economic news, the consumer price index (CPI) in the UK climbed 2.7% (YoY) in October, following a 2.2% rise in the previous month. Meanwhile, the seasonally adjusted input producer price index (PPI) rose 0.4% (MoM) in October. Moreover, the output PPI rose a seasonally adjusted 0.1% in October. Separately, retail price index rose 0.6% (MoM) in October. Meanwhile, the Office for National Statistics (ONS) indicated that the House Price Index (HPI) rose 1.7% (YoY) in September, compared to a revised 1.9% rise recorded in the previous month.
In the Asian session, at GMT0400, the pair is trading at 1.5889, with the GBP trading marginally higher from yesterday’s close.
The pair is expected to find support at 1.5860, and a fall through could take it to the next support level of 1.5830. The pair is expected to find its first resistance at 1.5917, and a rise through could take it to the next resistance level of 1.5945.
With inflation data lowering expectations of further stimulus, today’s BoE Inflation Report will be closely watched for an insight into where the Monetary Policy Committee (MPC) is standing with respect to the option of introducing further quantitative easing.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.
